The looming year of 2025 casts a shadow over the UK’s banking landscape, with the ominous prospect of widespread branch closures. January alone anticipates the shuttering of 45 branches, a stark indicator of the accelerating trend towards digital banking. This wave of closures follows a pattern established in recent years, with over 6,200 branches disappearing since 2015, averaging around 53 closures per month. The relentless march towards online services, championed by banking institutions, leaves many communities grappling with diminished access to essential financial services. This digital shift raises concerns about financial inclusion, particularly for vulnerable populations less comfortable with or lacking access to online platforms.
Lloyds Banking Group, a major player in the UK banking sector, plans to close 55 branches between January and September 2025, impacting customers across Lloyds, Bank of Scotland, and Halifax brands. This contributes to the larger trend identified by consumer group Which?, which highlights NatWest Group as the most prolific branch closer, having shuttered 1,428 locations since 2015. Barclays follows closely behind, with 1,228 closures, emphasizing the industry-wide shift away from physical branches. Geographically, the South East of England has borne the brunt of these closures, followed by London, Scotland, and the North West, creating banking deserts in some regions and exacerbating existing inequalities in access to financial services.
Adding to the concern, Which? identified 30 constituencies across the UK now devoid of any bank branches, leaving residents with limited options for in-person banking. This includes areas such as Liverpool Wavertree, North East Derbyshire, and Reading West and Mid-Berkshire, highlighting the uneven distribution of banking services and the potential for financial exclusion. The closure of these branches creates significant challenges for those who rely on cash, lack digital literacy, or simply prefer face-to-face interaction for their banking needs. These closures disproportionately impact older individuals, those with disabilities, and individuals in rural communities with limited access to transportation or reliable internet connectivity.
In response to public outcry and pressure from advocacy groups like Link, a collaborative effort to establish voluntary banking hubs is underway. These hubs aim to mitigate the impact of branch closures by providing essential face-to-face banking services in affected communities. The hubs offer a range of services, including cash deposits and withdrawals, balance checks, bill payments, and utility top-ups, irrespective of the customer’s bank affiliation. This collaborative approach seeks to maintain a level of access to banking services for those who cannot or choose not to utilize online platforms.
The establishment of banking hubs follows a specific criteria determined by Link, the organization responsible for assessing the need and recommending locations. Generally, hubs are considered for areas with a population exceeding 10,000 and at least 70 shops, indicative of a sufficient customer base and commercial activity. Link also considers demographic factors such as average age and digital skills within the community, as well as transportation accessibility, to ensure the hubs are located where they are most needed. Encouragingly, community activism has played a role in securing banking hubs, with 57 towns successfully campaigning for these essential services.
Banking hubs, operated by the Post Office, offer a range of services designed to fill the void left by branch closures. Beyond basic transactions, the hubs provide private booths for customers to discuss confidential financial matters with representatives from their respective banks. Staff from various banks rotate through the hubs, ensuring access to a wide range of banking services throughout the week. Furthermore, the hubs offer financial advice and support on products such as loans, mortgages, and savings accounts, providing a valuable resource for financial planning and decision-making within communities affected by branch closures. For those without access to a hub, the Post Office continues to offer basic banking services, including cash withdrawals and deposits, balance enquiries, and bill payments, providing a vital safety net for those excluded from traditional banking channels.
